The Department of the Treasury (Treasury) requires immediate management consulting services to: a) assist in Treasury’s continued assessment of the automotive sector generally; b) assist in Treasury’s work with General Motors Corporation (GM) and GM advisors to develop a comprehensive restructuring and business plan acceptable to the Government (“GM Restructuring”) and thoroughly evaluate that plan; and c) advise Treasury with respect to the results of its comprehensive diligence exercise evaluating the viability of the announced alliance between Fiat and Chrysler, LLC (“Chrysler Alliance”).

B. Background

On December 19, 2008, the Treasury announced that it would act to support certain domestic automobile manufacturers, on the condition that they move quickly to develop and adopt acceptable plans for long term viability. This step was intended to prevent significant disruption to the economy, while putting the companies on a path to the significant restructuring necessary to achieve long-term viability.

On February 20, 2009, the Presidential Task Force on the Auto Industry (PTFAI) was announced. The PTFAI, which includes Treasury Secretary Timothy Geithner as a co-chair and member, is currently working with GM to develop a restructuring plan for GM that would be acceptable to the Government, evaluate the viability of a Fiat/Chrysler, LLC alliance, and alleviate the pressure that the current economic situation has placed on other aspects of the automotive industry, including automobile finance companies, suppliers, and dealers. In fact, on March 30, 2009, the President announced a new plan to address the needs of GM and Chrysler, LLC (Chrysler) focusing on a GM Restructuring and the Chrysler Alliance, respectively. GM has been given 60 days to develop a new, workable business plan and Chrysler has been given 30 days to conduct due diligence and to negotiate a final agreement with Fiat. Given these deadlines, there is extreme urgency in the timing of the work that needs to be completed. The Treasury requires the services of a management consulting firm to timely assist the Treasury concerning this work. In the case of GM, the Treasury and the Contractor will work with GM and its advisors to create a viable business plan that is acceptable to the Government as a roadmap for the company, including a detailed operating plan and financial plan. For Chrysler, the Treasury, with the assistance of the Contractor, will critically assess the likelihood of success of the Chrysler Alliance and determine whether to extend financing to support the transaction.

In furtherance of Treasury’s need to make such assessments and provide recommendations regarding the automotive industry, Treasury is seeking assistance in continuing its assessment of the automotive sector generally as well as evaluating the GM Restructuring and the Chrysler Alliance.

C. Scope

As detailed in Section A above, the scope of the services required is management consulting services with direct applicability to the evaluation of the GM Restructuring and the Chrysler Alliance. These services will support the work of the Treasury in its participation on the PTFAI and its administration of the Troubled Assets Relief Program (TARP).

D. Contractor Qualifications

The Contractor must have an understanding of the competitive dynamics within the auto industry, the industry structure and the stated financial and economic drivers for GM and Chrysler. It is important that the Contractor have a global perspective on the industry to assess both the domestic and international operations of these companies. Most importantly, the Contractor must have an understanding of the internal economics, key operational issues, business drivers and management personnel of GM and Chrysler. Additionally, the Contractor must have an understanding of Fiat’s operations to be able to fully evaluate the Chrysler Alliance.

Assessments performed pursuant to this statement of work are anticipated to involve a significant degree of operational intensity and will require intimate knowledge of the inner workings of GM and Chrysler as a basis by which to assess their plans.

E. Anticipated Work

In furtherance of its requirement to assist the Treasury in evaluating the automotive restructuring plans and to provide recommendations regarding the automotive industry, Treasury is seeking assistance in building upon its initial work assessing the automotive sector both generally (including but not limited to, stakeholders or constituencies that are either directly or indirectly impacted by the automotive sector) and critically, (b) working closely with GM, GM advisors, and Treasury in the creation of a new, comprehensive restructuring and business plan for GM that is acceptable to the Government, and thoroughly evaluating that plan, as well as (c) evaluating the merits of the Chrysler Alliance.

Such assistance will include, but is not limited to, reviewing and analyzing a great deal of information about the automotive sector broadly, and GM and Chrysler specifically, either through resources held by the Government, the Contractor, GM, Chrysler or Fiat, or otherwise acquired at the Contractor’s expense. Specific matters to be reviewed and analyzed include, but are not limited to, an evaluation of: anticipated market size and car sale volumes over a five year period; market share considerations for GM and Chrysler; competitive dynamics within the automotive industry; pricing, cost and margin prospects for GM and Chrysler; and the sales prospects for Fiat-derived A/B/C cars in the United States. Other work related to these topics within the scope of this solicitation may be required, as the process of assessing these companies and the automotive sector generally unfolds.

It is anticipated that a very significant portion of the work in this engagement will be focused on critical assessments of the GM Restructuring plan and the Chrysler Alliance. In the case of GM, the Contractor must work closely with Treasury and, on behalf of Treasury, with GM to develop a viable, detailed operating and financial plan acceptable to the Government. For the Chrysler Alliance, the Contractor must evaluate in detail a proposed Chrysler/Fiat operating plan, including the steps to reach integration and an assessment of the combined operations as well as thorough assessments of both Chrysler and Fiat.

The anticipated management consultant services to be performed include, but are not limited to, the following:

1. Macro forecasting

(a) Provide up-to-date base, downside, and upside scenarios for production forecasts for the automotive industry over a five year period, taking into consideration the sharp decline in industry activity, potential secular shifts in consumer consumption and vehicle usage, the impact of disposable income and the availability of consumer credit and a variety of other macroeconomic and microeconomic factors.

(b) Analyze scenarios with sensitivities to market share and pricing based on various assumptions.

2. General Motors – Creation of Restructuring Plan

(a) Assist in developing achievable sales forecast with detailed buildup for volumes, market share, brand strategy, pricing program, use of incentives and how this fits within the overall competitive landscape for the industry with a focus on optimizing variable profit contribution per unit produced.

(b) Assist in developing cost structure analysis based on sales forecast to optimize the fixed cost structure necessary to support the operations under various production scenarios. This analysis should include consideration of the assessment of required overhead, R&D, manufacturing costs and other fixed costs. As part of these services the Contractor shall:

a. Provide detailed review of capital expenditure budget with rigorous analysis of return on capital for each dollar allocated;

b. Evaluate the research and development (R&D) budget with returns based approach to assess investments in new projects, and provide historical evaluation of R&D planning, investment and outcomes;

c. Review marketing plans and assess the effectiveness of dollars spent; analyze spending by brand; and review the budgeting process;

d. Assess operations to determine production optimization plans; and

e. Review international operations and interrelationship with US operations.

(c) Document the plan of operations for restructuring including the steps to achieve plans outlined for sales strategy and cost structure.

(d) Outline appropriate capitalization for the restructured company.

(e) Assist the financial modeling team in identifying inputs based on the work described herein.